Suppose the width of Edgeworth box is 12 and heig…View the full answer

## Present Value of the Free Cash Flows Projected Assignment | Homework For You high school essay help

Brandtly Industries invests a large sum of money in R&D; as a result, it retains and reinvests all of its earnings. In other words, Brandtly does not pay any dividends, and it has no plans to pay dividends in the near future. A major pension fund is interested in purchasing Brandtly’s stock. The pension fund manager has estimated Brandtly’s free cash flows for the next 4 years as follows: $4 million, $5 million, $9 million, and $16 million. After the fourth year, free cash flow is projected to grow at a constant 5%. Brandtly’s WACC is 10%, the market value of its debt and preferred stock totals $64 million; and it has 12 million shares of common stock outstanding.

Write out your answers completely. For example, 13 million should be entered as 13,000,000.

What is the present value of the free cash flows projected during the next 4 years? Round your answer to the nearest cent. Do not round your intermediate calculations.

$

What is the firm’s horizon, or continuing, value? Round your answer to the nearest cent.

$

What is the firm’s total value today? Round your answer to the nearest cent. Do not round your intermediate calculations.

$

What is an estimate of Brandtly’s price per share? Round your answer to the nearest cent. Do not round your intermediate calculations. Get Finance homework help today

## Value of Free Cash Flows Assignment | Homework For You high school essay help

The width of an Edgeworth box is 12 and the height of the Edgeworth box

Dantzler Corporation is a fast-growing supplier of office products. Analysts project the following free cash flows (FCFs) during the next 3 years, after which FCF is expected to grow at a constant 8% rate. Dantzler’s WACC is 10%.

Year

0

1

2

3

…….

…….

…….

…….

…….

…….

…….

…….

…….

…….

…….

…….

…….

…….

…….

……

FCF ($ millions)

– $18

$14

$43

What is Dantzler’s horizon, or continuing, value? (Hint: Find the value of all free cash flows beyond Year 3 discounted back to Year 3.) Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55.

$ million

What is the firm’s value today? Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. Do not round your intermediate calculations.

$ million

Suppose Dantzler has $79 million of debt and 13 million shares of stock outstanding. What is your estimate of the current price per share? Round your answer to two decimal places. Write out your answer completely. For example, 0.00025 million should be entered as 250.. Get Finance homework help today

## Interest Rates Assignment | Homework For You high school essay help

If the Federal Reserve takes actions to raise interest rates in the economy, this will most likely affect which of these risks facing businesses in the United States?

Interest rate risk

Financial risk

Tax risk

Business risk

What must the probabilities of the different states of nature sum to?

0.0

1.0

100.0

-1.0

How is the expected return computed?

By multiplying the probability of each state of nature with its return and add them together

By multiplying the probability of each state of nature with its return, add them together, and

divide by n, the number of states of nature

By adding the returns from each state of nature and divide by the number of states of nature

By finding the scenario with the highest probably of occurrence and use the corresponding return as the expected return estimate

Which of these processes incorporates many different combinations of variables while running the analysis several thousands of times when creating a forecast?

Expected returns

Scenario analysis

States of nature

Simulation

Which of the following are true?

Statement 1: Common stocks are a guaranteed investment for generating high returns next year.

Statement 2. Treasury bond returns will always exceed the inflation rate.

Statement 1 only

Statement 2 only

Both statements 1 and 2

Neither statement 1 or 2

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## Financial Security Issued by a Corporation in Need of Capital Assignment | Homework For You high school essay help

which of the following is a type of financial security issued by a corporation in need of capital?

a. bonds

b. preferred stock

c. common stock

d. all of the above. Get Finance homework help today

## Expected Change in Stock Price Assignment | Homework For You high school essay help

On January 1, Coronado Inc. completed its analysis of the prospects for the Geriatric Toy Store and concluded that there was a 15-percent chance the stock price would be $130 in one year and an 85-percent chance the stock price would be $180. Six months later, Coronado Inc. revised its estimated probabilities to a 30-percent chance of a stock price of $130 and a 70 percent chance of $180. If the market agrees with Coronado Inc.’s revised probabilities, what is the expected change in stock price from January 1 to July 1? Assume the discount rate is zero. (Round answer to 2 decimal places, e.g. 15.25.)

Expected change in stock price will _______ (increase or decrease) of _________ $ .Get Finance homework help today

## Future Value of Savings Assignment | Homework For You high school essay help

Lee Holmes deposited $17,000 in a new savings account at 9% interest compounded semiannually. At the beginning of year 4, Lee deposits an additional $42,000 at 9% interest compounded semiannually. At the end of 6 years, what is the balance in Lee’s account? (Do not round intermediate calculations. Round your answer to the nearest cent.)Get Finance homework help today

## Purchase Additional Life Insurance Through Employer Assignment | Homework For You high school essay help

Which of the following is true for John if he purchases additional life insurance through his employer?

a. Few exclusions are associated with these types of policies.

b. Because most group term policies have a conversion feature, he can be assured that upon termination of employment he can continue his coverage.

c. He can tailor the coverage to his own needs.

d. All of the above are true.Get Finance homework help today

## Stock’s Current Market Value Assignment | Homework For You high school essay help

The Radley company has decided to undertake a large new project. Consequently, there is a need for additional funds. The financial manager decides to issue Preferred stock which has a stated dividend of $11.00 per share and a par value of $100. If the required return on this stock is currently 16%, what should be the stock’s current market value?

A.68.75

b.73.33

c.46.25

d100

e.11. Get Finance homework help today

## Sharpe Ratio on the Portfolio Assignment | Homework For You high school essay help

What is the Sharpe ratio on the portfolio if the risk free rate is 4%. The portfolio has return of 6.8% and standard deviation of 20%.

a) 14%

b) 13%

c) 1.4%

d) 140%. Get Finance homework help today

## Standard Deviation of an Efficient Portfolio Assignment | Homework For You high school essay help

What is the standard deviation of an efficient portfolio with a 19.9-percent expected rate of return, given that RF is 4.9 percent, ERM is 7.9 percent, and σM is 23.9 percent?

a) 239.000 percent

b) 109.50 percent

c) 119.50 percent

d) 50.21 percent. Get Finance homework help today

## Variable Life Insurance and Universal Life Insurance Assignment | Homework For You high school essay help

Haley would like to know the difference between variable life insurance and universal life insurance. Which of the following statements most accurately describes the difference?

a. Variable life insurance uses subcontracts that are invested to generate a guaranteed rate of return.

b. Universal life insurance uses a fixed mortality charge, and variable life insurance does not.

c. Variable life insurance has a death bene t that varies, and universal life insurance provides only a fixed death benefit.

d. Universal life insurance provides a crediting rate based on the insurance company’s general account subject to a minimum guarantee, and variable life insurance uses subaccounts that can fluctuate based on market returns.Get Finance homework help today

## Present Value Assignment | Homework For You high school essay help

What is the present value at year zero for the following at a discount rate of 10%? At year zero (now), you receive $12,000?

A) $9,015.78

B) $12,000

C) $9,917.36

D) $10,909.09

E) None of the Above

You will receive a payment. Which is 3 times the present value of this payment if the idscount rate is 7% every year, which yer will you receive this payment?

A) 17.89 years

B) 10.67 years

C) 19.35 years

D) 16.24 years

E) None of the Above. Get Finance homework help today

## Insurance Coverage Assignment | Homework For You high school essay help

Haley is worried that Troy will be without health insurance after he graduates from college with his B.S./B.A. degree in a few years. Her primary worry is that he may not immediately find employment or be eligible for employer-provided coverage for an extended period of time, such as ninety days. Given these concerns, which of the following are examples of appropriate insurance coverage recommendations for Troy once he graduates?

a. Purchase no coverage; Haley’s concerns are not valid as the Affordable Care Act (ACA) of 2010 extends coverage under a parental policy until young adults reach the age of twenty-six.

b. Purchase no coverage; Haley’s concerns are not valid as the Affordable Care Act (ACA) of 2010 extends coverage under a parental policy until the age of twenty-six as long as the young adult does not have coverage available through an employer plan. When available, he will have coverage.

c. Extend his current coverage through a COBRA extension.

d. Purchase insurance through an Affordable Care Act (ACA) of 2010 high-risk pool.Get Finance homework help today

## Loan Payment Assignment | Homework For You high school essay help

## Return on the Market and the Risk-Free Rate Assignment | Homework For You high school essay help

Stock A has a beta of 1.70 and an expected return of 19.5 percent. Stock B has a beta of 1.10 and an expected return of 14 percent. If CAPM holds, what should the return on the market and the risk-free rate be?Get Finance homework help today